Kerr deliberately manipulated the market in London International Financial Futures and Options Exchange traded coffee futures on August 15 2007. The broker was found to have executed trades during a crucial one minute period of trading to increase artificially the price of coffee futures, in order to benefit one of his clients.
Although Kerr was successful in his attempts to manipulate the market, his client did not make the intended profit. The FSA says this does not diminish the seriousness of the offence.
Kerr also provided false and misleading information during the FSA’s investigation, which it says “poses a risk to maintaining confidence in the financial system”.
Director of markets Alexander Justham says: “Market manipulation is a serious offence. Kerr breached the standards expected of approved persons and has paid the price. Participants in the futures and options markets should be in no doubt about how seriously the FSA views manipulation which disrupts proper pricing mechanisms and risks a false market in the underlying commodity.
“This fine and the ban from working in the financial services industry are significant penalties and should serve as a reminder to all that market manipulation will not be tolerated regardless of whether any profit was made.”